Validators process transactions and receive fees from users (supply-side fees).

Flow is a smart contract platform for decentralized applications (a blockchain). Flow was founded by Roham Gharegozlou, Dieter Shirley and Mikhael Naayem and launched in 2019.

FLOW holders own and govern the protocol. They currently don’t take a cut of the total transaction fees paid by users (revenue). Flow’s investors include a16z, Coatue, Coinfund, Fabric Ventures, etc.

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Blockchains (L1)

Flow

# Flow Average revenue per user (ARPU) Methodology

## 1. Overview

Flow's Average Revenue Per User (ARPU) metric measures the average daily revenue generated per active user across the Flow ecosystem. This metric divides daily protocol revenue by daily active users to understand revenue efficiency and user value. Flow uses a unique "Inflation Offset" economic model where protocol revenue consists of excess fees beyond validator staking rewards, making ARPU particularly meaningful for assessing the protocol's ability to generate sustainable revenue from user activity.

## 2. Data sources

The calculation uses several key data sources:
- **Flow transaction data**: L1 transaction records including payer addresses, proposal key addresses, and transaction fees
- **Flow EVM transaction data**: L2 transaction records with from/to addresses, gas usage, and gas prices  
- **Staking reward events**: Parsed `RewardsPaid` and `DelegatorRewardsPaid` events from Flow's staking contracts
- **End-of-day price feeds**: FLOW token prices from CoinGecko for USD conversion
- **Transaction fee data**: Native FLOW fees from Flow transactions
- **Gas fee data**: Flow EVM gas fees calculated from gas usage and pricing

## 3. Step-by-step calculation

### Component A: Revenue calculation
- **Purpose**: Calculate Flow protocol revenue using the inflation offset economic model
- **Logic**: Flow implements a unique economic model where total staking rewards are fixed per epoch, and fees are used to pay validators first. Protocol revenue equals any excess fees beyond validator needs. The calculation determines revenue as MAX(Fees - Total Staking Rewards, 0). For Flow, transaction fees are collected and aggregated daily, then compared against total staking rewards (sum of node operator and delegator rewards from staking events). Flow EVM revenue is set to zero since its fees flow to Flow validators. All amounts are converted to USD using end-of-day FLOW token prices.
- **Key fields**: `fee_amount` from transactions, `reward_amount` from staking events, `total_staking_rewards`, `fees`, `revenue`

### Component B: Daily active users calculation  
- **Purpose**: Count unique users across both Flow and Flow EVM chains
- **Logic**: Users are identified from transaction initiators on both chains. Flow users include both `payer` addresses (who pay transaction fees) and `proposal_key_address` addresses (transaction proposers) from Flow transactions. Flow EVM users are `from_address` addresses from Flow EVM transactions. All user addresses are deduplicated daily across both chains using HyperLogLog for scalable distinct counting. The system aggregates users by day, chain, product, and user type, then combines all unique addresses to get total daily active users.
- **Key fields**: `user_address`, `block_timestamp`, `payer`, `proposal_key_address`, `from_address`, `user_dau`

### Final aggregation
- **Combining components**: Revenue and user metrics are calculated for matching daily time periods and then combined using the ARPU calculation macro
- **Currency conversion**: Flow fees and rewards are converted to USD using end-of-day FLOW token price feeds, while Flow EVM fees are already in native FLOW
- **Time aggregation**: Both revenue and user data are aggregated to daily boundaries using timestamp truncation to day granularity
- **Final calculation**: ARPU equals daily protocol revenue divided by daily active users (Revenue ÷ DAU), providing the average revenue generated per active user each day

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

FlowFLOW

Average revenue per user (ARPU)

Average revenue per user (ARPU)

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